The Myth of Early Globalisation: The Atlantic Economy, 1500-1800

Résumés

In recent historiography, it has been argued that the expansion of Europe between 1500 and 1800 created a “system” in the Atlantic by which the economies of Europe, West Africa and the New World were closely interconnected by trade and migration. However, the available evidence suggests that the economic implications of such a system were of marginal importance. Rather than boosting the economy, the “Atlantic System” stimulated the expansion of European values and norms, such as private property, monogamy, the nuclear family, free labour, and the place of women and children in society.

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1What is a system and how does it differ from a circuit, a region or a space? In the historical literature precise definitions are hard to come by, so there is no way of finding out whether the “Atlantic System” is unique. It is true that we do not use the word “system” to describe the trade in goods and the migration of people within the Mediterranean of the 14th and 15th centu­ries nor do we talk about an “Asian System” when discussing the European expansion in Asia during the same period in whi­ch the so called “Atlantic System” came about1.

2In this contribution I would like to look at the trade in and the production of goods as well as at the movement of people within the Atlantic area. Do these maritime exchanges constitute sufficient building stones to speak of a system? My conclusion will be that indeed the Atlantic World was unique before 1800 in comparison with other geo-political areas, but that an “Atlantic System” was not an economic phe­nomenon, but a cultural one. In the Atlantic the economies of Europe, Africa and the New World largely remained independent from one another. Only the European trading forts along the coast of West Africa, the plantations in the New World and certain Atlantic port cities in Western Europe were so interconnected that we can speak of a slave trade cum plantation system in which one section could not survive without the other. The economic impact of this system, however, was too small to affect the economies of the three Atlantic continents at large with the possible exception of Great Britain during the second half of the 18th century2.

3Allow me to argue my case by discuss­ing the two main econ­omic activities in the Atlantic area during the period under review: the trade in goods and human migra­tion.I will not belittle their volume and impact, but I will argue that the trade and migration of the Atlantic were only marginal additions to the trade and migration with no Atlantic connec­tion.

4Regarding the trade in goods, I can be very brief. In none of the continents around the Atlantic Ocean was more than 2 percent of their Gross National Product (GNP) generated by intercontinental trade. We should realise that all shipping tonnage in Europe around 1500 could fit into only two present-day super tankers and that we would need five such tankers to arrive at the tonnage avail­able around 1800. Everywhere in the world both production and consumption took place locally and if goods moved, they moved mainly within a region and hardly beyond the bor­ders of a con­tinent3.

5I now could turn to my second topic, human migration, if it were not for the fact that you might feel short-changed about this apodictic statement regarding inter-Atlan­tic trade. Almost every economic activity seems marginal com­pared to the GNP of a continent. In view of that and in order to prove my point I will discuss the impact of Atlantic trade on West Africa and Western Europe.

6 The earlier historiography always stressed the fact that the African economy had experienced reduced growth or even decline because of Africa's detrimental involvement in the international trade in goods and the slave trade. Europe, on the other hand, was supposed to have strongly profited from its Atlantic trade even to the extent that the Industrial Revolution would not have come about with­out it4.

5 David Eltis and Lawrence C. Jennings, “Trade between Western Africa and the Atlantic World in the (...)

7In fact, there is no evidence that the volume of Atlantic imports could have been of great importance to the population of West Africa at large. Just two estimates will suffice to prove this. The first one enables us to measure the value per year of all imports and exports per head of the population. In West Africa per head of population that value was only 1/40th of that of a British citizen and 1/20th of a US citizen. The second estimate concerns the percentage of the import value in relation to internal produc­tion. The value of the European imports into West Africa could not have been more than 5 percent of the value of Africa's internal production and that is assuming that the Africans pro­duced no more than their subsistence5.

8Against this line of reasoning there are usually protests from Africanists who are quick to point out that the quantity of the Atlantic imports into Africa does not explain sufficiently what damage these imported goods did to the growth of the African economy. It was the specific character of those imports from Europe and not their volume that supposedly was responsible for their negative impact. As Africa imported mainly textiles, those imports are reputed to have reduced the demand for textiles produced in Africa. At the same time the reduced demand for home made textiles prevented the African textile producers to expand and to look for ways in which the manufacturing process could be industrialised. As the textile industry was one of the leading sectors in the early industrialisation in Europe it stands to reason to assume that the large-scale imports of foreign textiles were one of the reasons why an Industrial Revolution did not take place in Africa. In addition, Africa's Atlantic imports consisted of a disproportionately large number of guns and it seems obvious that those imports resulted in far more wars and bloodshed than the importation of normal trade goods would have done. In addition to textiles and guns, Africa also imported expensive alcoholic bever­ages and finished household items such as glassware and cutlery, again products not demanding any further processing and therefore not inductive to industrialising the African economy 6.

7 David Eltis and Lawrence C. Jennings, “Trade between Western Africa and the Atlantic World”, pp. 9 (...)

9However, all these arguments make little sense when put into the comparative framework of intercontinental trade during the early modern period. Why should the economy of Africa react differently to international trade than the economies of other continents at the time? The assortment of goods in the long distance trade to other areas in the world was similar to the range of trade goods imported into Africa. In fact, the volume of the imported goods into West Africa was relatively small: only one gun to 118 Africans, while in colonial North America the number of guns per head of the popu­lation was twice as high. The percentage of textiles in the trade to Africa was indeed relatively large, but the yearly volume was still barely enough to let every­ African have one handkerchief. This is proof of the fact that in West Africa the demand for textiles could only be satisfied marginally by importing textiles from abroad and the same applies to the demand for metal. In sum, there is no evi­dence to show that between 1500 and 1800 either quan­ti­tatively or qualitat­ively the Atlantic trade in goods could have made much of a differ­ence to the economy of West Africa7.

10As far as Western Europe was concerned, the same con­clusion applies. The volume and value of the trade in the non-European part of the Atlantic were relatively small. Regionally, of course, there were large differ­ences and there were indeed two countries where foreign trade accounted for more than 10 percent of their respective National Incomes: Portugal and the Dutch Republic. The economic histories of these two countries, however, are killing fields for those assuming that early Atlantic trade was a vital ingredient for industrialisation. It is true that the imports of precious metals from the gold and silver mines of Spanish America and Brazil were important to the economy of early mod­ern Europe because American gold and silver served to pay for the imports from Asia. However, without the precious metals from the New World Europe's bankers would have developed other means of pay­ment (i.e. more paper money) while the history of Spain shows that the large-scale importation of precious metal does not automatically provide for a booming economy, let alone for an industrial revolution. In addition to precious metals the main Atlantic imports into Europe between 1500 and 1800 were coffee and sugar, but there is no evidence that with­out these products Europe's economic and social development during the period under review would have been any different. Cotton, the other major New World export article did indeed contribute significantly to the economic growth of Britain, but not until after its indus­trial take-off 8.

11I will rest my case here. I realise that these fig­ures will meet with some scepticism. It was Western Europe that dominated the trade in the Atlantic World and it seems more than a coincidence that the economy of Western Europe was the first to industrialise. The economic prominence of the “Atlantic System” seems even more important when we take into account that during the second half of the 18th century Great Brit­ain had the greatest stake in the Atlantic economy and at the same time became the Atlantic's first industrial nation. However, on the other hand there are several nations with an Atlantic past that did not industrialise until very late in the 19th century such as Spain, Portugal and the Netherlands. I realise that there remains some­thing elu­sive in the rela­tion­ship between the growth of the Atlantic economy and of the econ­omies of the constituent regions in spite of the fact that all the figures point at a marginal impact at best.

12When we for the moment accept the position that the trade in goods did not make the Atlantic economy unique, we should turn to human migration. There is no doubt that migration has given the Atlantic its distinct character. However, before 1800 on a yearly count the number of migrants was not impressive: during the 300 years after Columbus about 2 to 3 million Europeans moved across the Atlantic and 7 to 9 million Africans. Thus, the loss to Europe amounted to 6,500 migrants on average per year and to Africa to roughly 30,000 slaves per year. When we assume that the coastal regions of both Western Europe, and West Africa housed populations of about 20 million each, Europe lost only 0.3 per thousand of its population per year and Africa 1.2. Do these emigration figures indicate that Europe or Africa suffered from depopulation? The answer must be negative. Between 1500 and 1800 the demo­graphic growth in Europe and Africa has been esti­mated to be 40 per 1000 per year showing that the migration into the Atlantic con­sti­tuted only a very minor fac­tor in reduc­ing European and African population growth9.

10 David Eltis, Economic Growth, pp. 64-71.

13Did Africa suffer more than Europe in view of the fact that Africa contributed more migrants to the Atlantic economy both during the 17th and the 18th centuries? In answering this question we must not forget that to Africa the Atlantic was just one of the areas of the trade in slaves. During the height of the slave trade between 1700 and 1850, it has been estimated that more than 21 million slaves have been traded in the whole of Africa of whom 4 million had died, 7 mil­lion had been sold to slave owners within Africa, 7 million had been exported to the New World and 3 million had been sent to the Middle East. Of course, I am quite ready to admit that the slave trade had more effects on some areas of West Africa than on others, but when we take the total volume of transatlantic migration between 1500 and 1900 into consideration both Portugal and Great Britain lost a larger percentage of their populations to trans-Atlantic destinations than did any area in West Africa10.

14This leads to the conclusion that although the volume of the trans-Atlantic migrations was unique, the demographic effects were limited for both the sending and the receiving countries. As far as the receiving areas are concerned, the high death rate among the immigrants explains the modest demographic impact of the immigration of 9 million slaves from Africa between 1500 and 1800. In contrast, the rapid increase of the European immigrants in the settlement colonies of both North and South America was impressive, but the “Atlantic System” had little to do with that. Most of the increase in the number of ex-Europeans was caused by autochthonous demographic growth in the New World and this growth would have taken place irregardless of any transatlantic links as shown by a similar demographic development among the European immigrants in the Cape of Good Hope colony, the only settlement colony outside the Atlantic orbit.

15How should we measure economic integration? Usually, historians and economists point to the volume of trade in relation to the GNP of a country or to the trends in trade or to the ratio of trade to output. Few pay attention to prices of commodities in the various markets in the Atlantic. “Commodity market integration implies that these prices should be converging over time; such price convergence will, other things being equal, drive up the volume of trade. However, the volume of trade could also increase for reasons unconnected with integration, or decline for reasons unconnected with disintegration: shifts in supply and demand will also lead to changes in trade flows, and these have no necessary connection with ‘globalisation’” 11.

16Recent calculations by O’Rourke and Williamson show that in the Atlantic before 1800 there was no tendency for prices to converge and that changes in the volume, composition, and direction of intercontinental trade were caused by local or regional changes in demand and supply, and that these changes were not connected with the growing integration of the Atlantic markets12.

17A similar observation can be made about the markets for migrants. The secular decline in living standards in 17th century Spain and the devastation during the Thirty Years’ War in Central Europe did not result in an increase of the number of trans-Atlantic migrants. Migration from Spain to the New World peaked in the 16th century and from Germany during the 18th century.

18If there was such a thing as an “Atlantic System”, where was it located? In dis­cuss­ing the econ­omy and demography of early modern Europe, tropical Afri­ca and the New World we do not seem to make much prog­ress. The aver­age Euro­pean, Amerindian and Afri­can was very much part of the economy of his own vil­lage, city or region and not a participant in a larger, integrated Atlan­tic society. Being part of the Atlantic economy was the excep­tion, not the rule for products as well as for people.

19In contradiction to this observation there exists a large body of traditional historiography saying that before 1800 the Atlan­tic System allowed Europe to profit from the vast, unexploited resources of the Americas and the abundant reserves of labour of Africa. Supposedly Europe was able to get a head start in the process of industrialisation by exploiting the non-European parts of the Atlantic System. That picture is incorrect. It is true that only the Europeans had the ships, the technological know-how and the equipment (some would say machinery) to set up plantation and settlement colonies. But technology in Europe was only marginally more advanced than the technology elsewhere. As a consequence the new, “Atlan­tic” additions to the existing range of products and services were limited. Cof­fee, sugar, and tobacco made up the lion's share and cotton became an import­ant Atlan­tic commodity only towards the very end of the period under review, thus decades after the beginning of the Industrial Revolution in Great Britain. In sum, there was nothing vital in the contribution of the specific products of the “Atlantic System” to the Industrial Revolution in Europe. The same conclusion applies to services. Cer­tain shipping firms, banks, merchants, and brokers specialised in handling transatlantic trade and migration, but most of these doubled in a non-Atlan­tic capacity.

20In looking for the economic foundations of the “Atlantic System” we are left with very little. No doubt the economies most dependent upon the Atlan­tic trade and migration were to be found in the plantation belt and in the mining regions of the New World. These were enclaves of economic growth based on the application of new technologies, but above all on the use of existing organisational, trading and financing skills from Europe and on the importation of African slaves across the Atlantic. In the colonies of European settlement in North and South America there was little innovation in the agricultural techniques in producing food crops and the Atlantic element was relatively small and not vital for the economic survival of these colonies, perhaps with the exception of New England. For British North America transatlantic trade was relatively important, but accounted for not more than 15 percent of total income. Regional differences were large, however, and that must have applied also to most of the South American colonies13. It was only in the plantation colonies that most of the economic activities were generated by transatlantic connections.

21Over time the economy of the “Atlantic System” became less, not more important. Today, after five centuries of transatlantic trade, between eighty and ninety-five percent of the interna­tional trade of any nation which borders the Atlantic is with its immediate neighbours, not with transatlantic partners. As David Eltis put it:

“Indeed, for most of Africa and the Americas (especially the Caribbean), in the last five cen­turies, has experienced diminishing, not increasing, dependence on transatlantic markets for goods, capital and labour over time. After a massive switch to transatlantic trade in the century or so after transatlantic contact was first estab­lished, the normal trend thereafter for most societies was a long secular shift back toward intra-African or intra-American trade, and perhaps above all, a return to a focus on domestic sources of demand for goods and supplies of factors of produc­tion. In the sense that most economies around the Atlantic have become more developed over time and the more developed the economy, the more important are its domestic relative to its external markets, globalisation and Atlantic history are myths”14.

22When we talk about the “Atlantic System” what we really mean is a system of economic, social and cultural values and institutions leading to the modern world. It should be stressed, however, that the modernising tendencies of the “Atlantic System” did not become apparent right away. Let me mention some examples.

23Free labour. It is surprising to note that the modern institution of free mobile labour in the early modern world only existed in Western Europe. In all other parts of the world slavery and other forms of unfree labour reigned supreme. Yet, when colonising the New World the Europeans used a modified form of the African institution of slavery to satisfy their demand for labour. It took more than three centuries before the modernising tendencies of the “Atlantic System” became apparent and before the Europeans abolished their slave trade and the institution of slavery in their colonies.

24Individual property. In the Atlantic the right to own property and to have that property protected by the state was uniquely European. Time and again European travellers remarked about the lack of private landownership in Africa and Amerindian America. The “Atlantic System” did lay the seeds of change, and in the areas of contact the European notion of private property became the norm. However, around 1800 Europeans, Africans and Amerindians still had widely diverging views on this matter.

25Insider/Outsider divisions. All peoples around the Atlantic practised this divi­sion. It explains what is wrong with the question as to why Africans were selling Africans. Africans did not feel that they belonged to one group and neither did the Europeans and Amerindians. However, over time the Atlantic experience changed these divi­sions. In the “Atlantic System” outsider groups such as Jews, Huguenots and Irishmen were included in the insider group much more easily than was the case in Europe itself. In the slave trade and among the slaves in the New World the same applies. The effects of the “Atlantic System” were slow to appear. It was not until the end of the 18th century when the “System” brought about a most dramatic change in the existing social and racial values, when increasing numbers of Europeans started to consider Africans and, indeed all other ethnic groups in the world as insiders, albeit not as equals. Over time that change had a dramatic impact and in a dialectical way destroyed the very heart of the “Atlantic System”, i.e. the slave trade cum plantation economy.

26The economic role of women and children. In Europe women and children were more and more banned from the centre of economic life. No wonder, Europeans were surprised to see African and Amerindian women perform a wide range of activities unheard of at home. The “Atlantic System” brought no unity in this respect. Overseas, the Europeans used African and Amerindian women and children for heavy fieldwork. It was only towards the end of the 18th century that protests were heard in Europe. It is a mistake to assume that economic rationale dictated the limited role of women and children in the economy of Europe. The choice to ban women and children from a wide range of activities in Europe was a cultural one not an economic imperative. Had women and children been used as was done in Africa and Amerindian America, Europe would have experienced more economic growth than it did in actual reality.

27Monogamy and the nuclear family. Again, the “Atlantic System” was not successful in harmonising European, Amerindian and African family and kinship ties. Amerindian and African family structures remained different from those in Europe. Attempts at imposing the European family values were strongest among the slave communities in the New World. Around 1800, however, the cultural differences in this domain were almost as large as they had been before the creation of the “Atlantic System”.

28Economically speaking, before 1800 the “Atlantic Sys­tem” incorporated only a limited number of activities in Europe, Africa and the New World. The heart of the “System” consisted of the New World plantation agriculture, the trans-Atlantic slave trade and the trade in cash crops, and the voluntary trans-Atlantic migratory and labour movements.

29Some of the Atlantic economic activities required a new technology. Europe developed ways to invest money in other continents, to transport and insure bulk prod­ucts over long distances, and to devise new management methods in order to arrive at an industry-like labour regime. In Africa and Amerindian America the “Atlantic System” introduced new crops and animals that might have helped to reduce the negative demographic impact of the “System”.

30Yet, without the “Atlantic System” the economies of Western Europe, West Africa and the New World would not have been much different. Without the Atlantic Europe might have spent more of its resources on trade within Europe and with Asia. Virtually all factors of production used in the “Atlantic System” could easily be used elsewhere. Europe's consumption pattern would have changed, but not dramatically so as sugar and coffee were luxury items and not vital to the physical survival of Europe's population. Without the “Atlantic System” Africa might have increased its internal slave trade and the trade to the Middle East. Without the Atlantic contacts Amerindian America would have had no reason to export as many beaver skins.

31The only areas that would have suffered badly without the “Atlantic System” would have been the slave trading forts in Africa and the plantation colonies in the New World. The absence of the American consumer markets might have delayed the Industrial Revolution in Great Britain, but it could not have prevented it. Perhaps Eastern Europe would have taken the place as the market for England's manufactured goods.

32However, it is no use denying that in spite of the low opportunity costs of the “Atlantic System”, the Atlantic world in 1800 was radically different from the Asian world at that time. From 1500 onward a “clash of cultures” had begun in the Atlantic and that clash would not come to Asia until the end of the 19th century. That explains why the “Atlantic System” should not be seen as the beginnings of a global economy, but rather as cultural concept about values and norms such as the existence and protection of private property, monogamy and the nuclear family, the place of women and children in the economy and the society, and the superiority of free labour. The “Atlantic System” was not the victory of economic rationality. The “Atlantic System” was about the merging and transference of values and cultures, not about the resources of Africa and of the New World or about the transfer of capital and labour.

5 David Eltis and Lawrence C. Jennings, “Trade between Western Africa and the Atlantic World in the Pre-Colonial Era”, American Historical Review, vol. 93, n. 4, 1988, pp. 936-959; David Eltis, Economic Growth and the Ending of the Transatlantic Slave Trade, New York, 1987, p. 72.

8 Wolfgang, Reinhard, “Economic Change in the Atlantic Triangle”, in Hans Pohl, dir., The European Discovery of the World and its Economic Effects on Pre-Industrial Society, 1500-1800,Stuttgart, Franz Steiner Verlag, 1990, p. 40; Patrick K. O'Brien, “European Industrialisation from the Voyages of Discovery to the Industrial Revolution”, in Hans Pohl, dir., The European Discovery of the World, p. 171.